China Leading the World to Electric Cars

The government of China forced all automakers operating in the country to meet minimum requirements for new-energy vehicles starting in January 2019. This included plug-in hybrids, all-electric vehicles and fuel-cell cars.

Their plan resembles cap-and-trade systems being used worldwide for reducing carbon emissions. Automakers that don’t meet the quota can purchase credits from competitors that exceed the quota. If they don’t follow the plan they will be fined or, in the worst case, be forced to shut down their assembly lines.

Because of the size of the Chinese market for cars (it is the largest in the world) they are de-facto leading the world to a clean energy, all-electric future. As an example, Volkswagen AG sold 40 percent of its vehicles in China last year. They plan to offer 40 locally-produced electric vehicles within the next decade. They naturally agreed to meet the Chinese government’s targets. Other companies strongly invested in China include General Motors and BMW.

The electric vehicles that are most successful in the Chinese market will almost certainly be introduced to markets worldwide, including the United States. They will have proven customer appeal and reliability and, I predict, will be very affordable.